Starting next Tuesday, the Long Game’s format moves to weekly. We’ll still deliver data-driven storytelling, compelling interviews with industry and political leaders, and insight on the sustainability landscape on Tuesdays to keep you in the loop. If you want more depth, we’ve got you covered. Our Greenwire publication, by E&E News, covers major legislation, regulations, and court decisions, in addition to critical issues like natural resources, water, and endangered species. Learn more and get a free trial of our professional offering. Asset managers aren’t walking the walk on climate change, according to a new report assessing portfolios of 45 of the world’s largest firms in North America, Europe and Japan. About 95 percent of the portfolios reviewed by InfluenceMap, a nonprofit think tank are not aligned with the goals of the Paris Climate Accords, the group said. U.S. asset managers lagged behind their European counterparts, the report found, “often lacking a clear strategy for engaging companies and material sectors on climate, while demonstrating a shortage of support for emerging sustainable finance policies.” The findings were derived from an analysis of $16.4 trillion in the asset managers’ equity fund portfolios out of their $72 trillion in cumulative assets under management. The firms hold nearly three times as much equity in fossil fuel production companies as they do in green investments — $880 billion compared with $309 billion, the report found. The report graded asset managers using criteria including exposure metrics, policy engagement and support for climate-related shareholder proposals. Several firms backslid from their 2021 ratings: BlackRock from B to C, Fidelity from D to E+, Vanguard from C to D+ and State Street from B- to C+. InfluenceMap noted the impact of the anti-ESG movement on U.S.-based asset managers. Those firms, which have been incorrectly accused of boycotting the fossil fuel industry, have dialed back their public embrace of sustainable investment practices in the face of criticism from red-state officials and congressional Republicans. “While some asset managers have stated high-level concerns, most of the sector has not mobilized to combat these efforts,” the report said of the anti-ESG movement. European firms are doing more on climate issues than those in North America and Japan, the report found, but still lag behind global climate goals. While European firms are the most “strategically engaged with sustainable finance policy” and have a lower fossil fuel-to-green ratio than the other regions, they are not necessarily more supportive on policy matters. Still, regardless of location, the report found a “significant gap” between the increase in net-zero commitments by the asset managers and their lack of action in the near term, particularly both in their faltering stewardship efforts and their lack of policy support. InfluenceMap recommends firms disclose and review their trade group memberships and intensify their engagement with companies and shareholders in order to bridge that gap.
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